Consideration of proposals for setting up of Unit in a Special Economic Zone.
The Approval Committee may approve or approve with modification or reject a proposal placed before it under sub-rule
f rule 17, within fifteen days of its receipt:
Provided that where the approval is to be granted by the Board in terms of sub-rule
of rule 17, the Board shall approve or approve with modification or reject such proposal within forty-five days of its receipt:
Provided further that the Approval Committee or the Board, as the case may be, shall record the reasons, in writing, where it approves a proposal with modifications or where it rejects a proposal and Development Commissioner by order shall communicate such reasons to the person making the proposal.
The Approval Committee shall approve the proposal if it fulfils the following requirements, namely: -
the proposal meets with the positive net foreign exchange earning requirement as provided in rule 53;
availability of space and other infrastructure support applied for, is confirmed by the Developer in writing, by way of a provisional offer of space :
Provided that the Developer shall enter into a lease agreement and give possession of the space in the Special Economic Zone to the entrepreneur only after the issuance of Letter of Approval by the Development Commissioner:
Provided further that a copy of the registered lease deed shall be furnished to the Development Commissioner concerned within six months from the issuance of the Letter of Approval;
the applicant undertakes to fulfil the environmental and pollution control norms, as may be applicable;
the applicant submits proof of residence, namely, passport or ration card or driving licence or voter identity card or any other proof of the proprietor or the partners of partnership firms or Directors of the Company, as the case may be, to the satisfaction of Development Commissioner;
the applicant submits the Income-tax returns, along with annexures, of the Proprietor or Partners, or in the case of a company, audited balance sheet for the last three years.
the proposal shall also fulfil the following sector specific requirements, namely:-
export of high-grade iron ore, that is sixty-four per cent Fe and above, except iron ore of Goa origin and Redi origin, which would be subject to approval of Board;
no sub-contracting or job work of polyester yarn shall be permitted in Domestic Tariff Area or in Export Oriented Unit or Units in other Special Economic Zone:
Provided that this restriction shall not apply to the Units which intend to send the fabric, made by them out of polyester or texturised yarn, for sub-contracting but the third party exports shall not be permitted;
No proposal shall be considered for :—
recycling of plastic scrap or waste:
Provided that extension of Letter of Approval for an existing Unit shall be decided by the Board;
enhancement of the approved import quantum of plastic waste and scrap beyond the average annual import quantum of the unit since its commencement of operation to the existing Units;
reprocessing of garments or used clothing or secondary textile materials and other recyclable textile materials into clipping or rags or industrial wipers or shoddy wool or yarn or blankets or shawls: Provided that extension of Letter of Approval for an existing Unit shall be decided by the Board;
import of other used goods for recycling:
Provided that extension of Letter of Approval for an existing Unit shall be decided by the Board :
Provided further that reconditioning, repair and re-engineering may be permitted subject to the condition that exports shall have one to one correlation with imports and all the reconditioned or repaired or re-engineered products and scrap or remnants or waste shall be exported and none of these goods shall be allowed to be sold in the Domestic Tariff Area or destroyed;
Export of Special Chemicals, Organisms, Materials, Equipment and Technologies unless it fulfils the conditions indicated in the Import Trade Control (Harmonized System) Classifications of export and import items;
if there is any instance of violation of law or public policy by the promoters, having a bearing on the merits of the proposal;
the use of any plant or machinery previously used for any purpose in Domestic Tariff Area.
The Units in Free Trade and Warehousing Zones or units in Free Trade and Warehousing Zone set up in other Special Economic Zone, shall be allowed to hold the goods on account of the foreign supplier for dispatches as per the owner’s instructions and shall be allowed for trading with or without labelling, packing or re-packing without any processing:
Provided that refrigeration for the purpose of storage and assembly of Completely Knocked Down or Semi Knocked Down kits shall also be allowed by the Free Trade and Warehousing units undertaking the said activities:
Provided further that these Units may also re-sell or re-invoice or re-export the goods imported by them:
Provided also that all transactions by a Unit in Free Trade and Warehousing Zone shall only be in convertible foreign currency;
Units may also be set up for providing services or manufacturing services to Overseas Entities subject to following conditions, namely :—
Capital goods, raw materials including consumables sub-assemblies, components, semi-finished goods shall be supplied by the Overseas Entity free of cost;
Capital goods for setting up such facilities may also be supplied on loan or lease basis, provided the notional value of such capital goods shall be taken into account for calculation of Net Foreign Exchange Earnings under rule 53.
Finished goods shall be exported out of the country or transferred to the Customs Bonded Warehouse to be maintained by the Overseas entity :
the Unit shall receive the consideration for its manufacturing services in convertible foreign exchange directly from the said overseas entity;
in case the said manufacturing facility is used by the Unit for carrying out production on its own account, separate accounts shall be maintained for the manufacturing and service activity.
Explanation “Overseas Entity” means a non-resident or a person of foreign origin and includes a company not incorporated in India.
